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Ocean Freight Services NN. 8/2017- Integrated Tax (Rate) and Entry No. 10 of the NN. 10/2017- Integrated Tax (Rate), both dated 28.06.2017 declared unconstitutional: Hon’ble Rajasthan High Court
After Mohit Minerals Pvt. Ltd. v. Union of India, SCA No. 726 of 2018 [Hon’ble Gujarat High Court], Hon’ble Rajasthan High Court has also declared the subject Notification(s) unconstitutional regarding ‘Ocean Freight Services’ in M/s Lakhpat Trading and Industry Pvt. Ltd. v. Union of India, Civil Writ Petition No. 11799/2019 and M/s Mahesh Vegoils Pvt. Ltd. v. Union of India, Civil Writ Petition No. 14174/2019. Hon’ble Rajasthan High Court has primarily relied on Mohit Minerals (supra).
𝘕𝘰𝘵𝘦: 𝘔𝘰𝘩𝘪𝘵 𝘔𝘪𝘯𝘦𝘳𝘢𝘭 (𝘴𝘶𝘱𝘳𝘢) 𝘪𝘴 𝘱𝘦𝘯𝘥𝘪𝘯𝘨 𝘢𝘥𝘫𝘶𝘥𝘪𝘤𝘢𝘵𝘪𝘰𝘯 𝘣𝘦𝘧𝘰𝘳𝘦 𝘵𝘩𝘦 𝘏𝘰𝘯’𝘣𝘭𝘦 𝘚𝘶𝘱𝘳𝘦𝘮𝘦 𝘊𝘰𝘶𝘳𝘵.
Clarification regarding applicability of IGST on the repair cost, insurance and freight, on goods re-imported after being exported for repairs: CBIC
A Circular No. 16/2021-Customs dated 19.07.2021 issued by CBIC clarifying that re-import of goods sent abroad for repair attracts IGST and Cess (as applicable) on a value equal to the repair value, insurance and freight. According to the circular, it was always the intention to impose IGST and Cess (as applicable) on such re-import. Along these lines, the department has made clarificatory amendment vide NN(s) 36/2021-Customs and 37/2021- Customs, both dated 19.07.2021, substituting “𝗗𝘂𝘁𝘆 𝗼𝗳 𝗰𝘂𝘀𝘁𝗼𝗺𝘀”, to the words “𝗦𝗮𝗶𝗱 𝗱𝘂𝘁𝘆, 𝘁𝗮𝘅 𝗼𝗿 𝗰𝗲𝘀𝘀”.
Clarification issued by GSTN on Negative liability in GSTR – 4: GSTN
The reason for negative liability in GSTR – 4 is because of non filing of table no. 6 of Form GSTR – 4. The GSTN proposed a solution of raising a ticket to nullify the amount available in the negative liability statement.
No liability of interest in the reversal of wrongfully availed ineligible ITC: Hon’ble Madras High Court
In M/s F1 Auto Components P. Ltd. v. The State Tax Officer, Survey, Cell – 1, Intelligence – II, Chennai, W.P. No. 6631 of 2021 and WMP No. 7188 of 2021, order dated 09.07.2021, Hon’ble High Court held as follows:
- Section 42 of the CGST Act is applicable in the case of mismatch not for wrongful availment of input tax credit; and
- Set aside the interest on remittances by way of adjustment of electronic credit register in light of Maansarovar Motors Private Limited V. The Assistant Commissioner, Poonamallee Division, Chennai (W.P.Nos.28437 of 2019 etc. batch, order dated 29.09.2020).
Stay of recovery in case of non-availability of Appellate Tribunal: Hon’ble Rajasthan High Court
In M/s Yutaka Autoparts India Pvt. Ltd. v. The Joint Commissioner of State Tax, Anti- Evasion, S.B. Civil Writ Petition No. 6135/2021 – order dated 28.05.2021, petitioner-company contended that in the absence of the Appellate Tribunal the notice of recovery ought to have been stayed till the Appellate forum is made available. Background to this contention lies in Section 112(9) of the CGST Act i.e., when an aggrieved person files an appeal and makes a pre-deposit u/s. 112(8) then recovery proceeding on the balance amount gets stayed. As in the absence of the Appellate Tribunal, the appellants are devoid of statutory stay granted under Section 112(9).
Note: The above writ petition is pending and, in the meanwhile, recovery has stayed. On similar lines of Section 112(9) in M/s Rasool Ahmad and Sons v. State of U.P. and Ors., WTAX No. 443/2021 vide order dated 19.07.2021 Hon’ble Allahabad High Court has granted the stay on pre-deposit u/s. 112(8).
Revocation of cancellation of registration in case of clearing all dues: Hon’ble Gauhati High Court
In M/s Aich Brothers v. Union of India and 6 Ors., WP(C) 3222/2021, order dated 13.07.2021, petitioner-company has discharged the tax dues but has an outstanding interest liability for delayed filing of returns (GSTR-3B). Because of the outstanding interest liability, the cancellation of registration was not revoked by the department.
Held: The registration of the petitioner company shall be restored if all the dues are cleared by the petitioner company.
GST is applicable if the transfer of possession or right during GST regime: AAR Telangana
In M/S Vajra Infracom India Pvt. Ltd. – TSAAR Order No. 03/2021 dated 19.07.2021, the applicant-company is in the business of construction of the residential complex. Before the inception of GST, the applicant company has entered into an agreement with the landowner for sharing of flats. The construction of flats continued during the GST period. Whether Service Tax or CGST + SGST is applicable?
It was held that the date of transfer of possession of the building or the right in it to the person supplying development rights will be the time of supply and the liability to pay tax on the said services shall arise on that day. If the applicant has handed over the building after the inception of CGST & SGST, then the liability to pay tax will arise under CGST & SGST.
Time granted by the Hon’ble High Court will be considered to determine the time u/s. 62 for filing return: Hon’ble Karnataka High Court
In Associate Decor Ltd. v. Assistant Commissioner of Commercial Taxes, LGSTO-150, Bengaluru and Ors., Writ Petition No. 45290/2019 (T-Res), best judgment assessment was done u/s. 62 of the CGST Act because of non-filer of the returns. In a previous writ petition Hon’ble High Court (‘HC’) granted time to the petitioner-company to file the return within the specified time. Petitioner-company complied with the HC’s order. After that department issued endorsement stating that the best judgment assessment orders passed were still valid and demands pursuant were required to be satisfied. Petition-company challenged the said endorsement in the instant writ petition. HC held that the petitioner company complied with the HC’s order and the return filed within the said time will be considered as return under Section 62(2) [62(2) – assessment deemed to be withdrawn if filed within 30 days of receipt of assessment order] hence, the assessment stands withdrawn.
The author may be reached at abhishek@gstivy.in*